Bitcoin saw a sharp decline from $79,500 in the run-up to the latest Federal Reserve (FOMC) meeting, reversing short-term gains. Historical data reveals that in seven out of the last ten FOMC sessions since early 2025, BTC prices have fallen following interest rate decisions. Analysts indicate that although prices often rally before meetings, they frequently experience significant selloffs immediately afterward.
Market volatility around FOMC events
In the past two years, Bitcoin’s reaction to FOMC meetings has been driven largely by shifts not just in rate decisions, but in liquidity and leverage conditions. At the turn of January and start of February, Bitcoin plunged by nearly 30 percent, with open interest in futures contracts dropping from $61 billion to $49 billion in a single week. During this period, BTC derivative markets experienced approximately $2.5 billion in liquidations, while the total for the broader crypto sector reached $4.5 billion.
Analysts consider these fluctuations to be typical market behavior ahead of FOMC gatherings. Dutch analyst Michael van de Poppe has noted that such corrections frequently occur during periods of heightened uncertainty around Fed policy.
“It almost always happens before the event, because markets still feel substantial anxiety about decisions coming from the Fed,”
he explained. Van de Poppe forecasts that so long as BTC holds above $73,000, prices could stabilize in their current range in the near term.
Institutional demand and ETF inflows offer support
Despite lingering caution in the short term, a surge in institutional buying is providing Bitcoin markets with firmer footing. Major portfolio manager Strategy notably raised its Bitcoin reserves in 2026, increasing its holdings from 672,497 BTC at the year’s start to 818,334 BTC. This means the company added 145,837 BTC to its holdings in 2026 alone. Analyses suggest that part of these purchases were financed via equity-linked securities used to bolster working capital.
A renewed uptick in institutional interest is also reflected in rising net inflows to spot Bitcoin ETFs. Approximately $3.5 billion of fresh capital entered these funds over the past two months. Experts believe that although short-term volatility persists, this ETF momentum signals stronger market confidence overall.
Critical support zones for Bitcoin
While macroeconomic factors continue to fuel periodic volatility in BTC, the asset has found strong support at key price levels. Since March, Bitcoin has repeatedly established a base around $60,000, $65,000, and $70,000. Even as short-term selling increased, long-term strategies and ongoing institutional accumulation have acted as safeguards against steeper declines.
Observers report that major economic events like FOMC meetings may temporarily dampen risk appetite, but underlying demand provides lasting resistance for BTC. This contributes to a more resilient and stable market structure over the long term.
Critical developments, such as persistent institutional purchases and strong ETF inflows, are seen as key protectors during major selloffs often triggered by Fed policy shifts. These elements help maintain foundational support even as market sentiment wavers in the face of volatility.
Analysts point to historical patterns: Bitcoin regularly rebounds after FOMC-driven corrections, building on increasing capital inflows and growing adoption among large investors. Sustained buying by institutions is reinforcing the idea that corrections following Fed decisions may be short-lived.
Ultimately, despite short-term shocks caused by macroeconomic announcements, the expansion of institutional investment—and more robust inflows into regulated ETF products—are providing Bitcoin with resilience amid uncertainty. Market participants remain attentive to upcoming central bank meetings and shifting liquidity conditions, but the fundamental demand base appears unshaken.
